Business Profile | Ravi K. Saligram

By Mark Zonca
November 2012 View more Business

A leader in integrating products, solutions, and services for the workplace, whether for business or at home,  Naperville-based OfficeMax is focused on transforming a company in one of the toughest industries in America today – Office Products. Naperville Magazine recently talked with Ravi Saligram, OfficeMax President and CEO, about the challenges and opportunities facing the third-largest U.S. office supply chain company.

Q&A

You joined OfficeMax as president and chief executive officer nearly two years ago. What are some of your proudest accomplishment so far?

When I joined OfficeMax, I was excited by the prospect of transforming the company. The Office Products industry generates $200 billion in U.S. sales annually, but is fragmented. It includes paper, ink and toner, supplies, and technology items ranging from PC’s, printers and eReaders, to smart phones. Within the Office Super Store (OSS) channel, which is roughly $45 billion in size, OfficeMax is the number three player, with sales of $7 billion.

Transforming a business starts with people, and I am most proud of our 29,000 associates. We’ve recruited some new team members to fill key leadership positions. This blend of new and existing leadership talent has created a winning combination. Overall, associate engagement is up 300 basis points. We’ve launched a new strategy—which we call our “Roadmap to Success”—to transform from an office products supplier, to a provider of workplace services and solutions. More than 100 OfficeMax leaders were involved from day one, so this strategy is owned by all of us.

And finally, I am pleased to see evidence that our turnaround is gaining traction. In the first half of 2012, our revenues are up modestly versus the prior year, a big deal given five years of revenue declines. Adjusted operating profit is up 42% and adjusted EPS is up 75% versus prior year.* Retention of our B2B customers is at a record high of 93%; and we were recognized by Ethisphere, a leading ethics thank tank, as one of the world’s 140 most ethical companies.

The move to consolidate the company’s headquarters in 2006 to Naperville has been a key milestone in your integration plan to keep OfficeMax competitive. Why was Naperville chosen as the location for your corporate headquarters? Has Naperville lived up to its reputation as a good corporate partner?

Naperville has lived up to its reputation as a good corporate partner. Naperville and the surrounding areas offer great places to raise families. The area provides high-performing public education, restaurants, and recreational options are plentiful, and access to the greater Chicago area is convenient. We’re proud to call Naperville our home.

The economic recovery still lacks luster. How has OfficeMax positioned itself to remain competitive in a difficult consumer market?

Our industry has a strong correlation with GDP. While we are not seeing any economic tailwinds yet, we are laser-focused on what we can control. Our “Roadmap to Success” strategy has three key pillars: (1) strengthening and turning around the core business; (2) balance sheet management; and (3) driving innovation. Within our core business, we are focused on controlling costs and identifying growth adjacencies. For example, one adjacency is offering an office products store-in-store option for retailers. We now sell OfficeMax products in 6,000 retail stores, like Safeway. In terms of innovation, we’re focused on providing appropriate solutions for businesses, from sole proprietorships to large enterprises. Our associates’ mission is to help our customers work better. The service orientation of our people overall is what really distinguishes our brand.

Technology has drastically changed the landscape of office products. How do you inspire and create innovation within your company to meet the constantly evolving needs of your customers?

Understanding the customer—finding the gaps and innovating to fill unmet needs—always yields success. We are evolving our model to be more and more about services and solutions. It’s an omnichannel world where customers want to buy when they want, how they want, and where they want—and they will be loyal to the brands that recognize them and create affinity, no matter in which channel they choose to shop. We are already one of the country’s top 15 e-tailers and are gaining double-digit growth now in our Digital channel. We are developing new store formats that are smaller in size and focused on satisfying the needs of small businesses. Ultimately, we want our brand to integrate and leverage different channels that drive the most innovative products, services and solutions to various customer segments, freeing those customers to do their best work.

You have a lot of global experience. You received your bachelor’s degree from Bangalore University in India and your Master of Business Administration degree from the University of Michigan. What do you enjoy most about living in the Midwest and in the Naperville area?

I started my career in Chicago 30 years ago. Since then, my family and I have lived in several cities and countries. I am delighted to be back in the greater Chicago area and to call America our permanent home. Although we’ve grown a lot from our global experiences, I love America because you can be who you want to be here. This is a place where merit truly counts. Only in America could an engineer from Bangalore end up running a Fortune 300 company. I am the eternal optimist and continue to believe the best days of America are ahead of us. This is the land of entrepreneurial opportunities, and OfficeMax has a strong focus on enabling entrepreneurial growth.

As president and CEO of OfficeMax, it seems as though you are always on the go. When you have time away from the office, what do you enjoy doing during your limited spare time?

Spending time with family and friends is energizing for me. My family and I love the diversity and rich cultural life in Naperville and greater Chicago. We find the people here to be truly friendly.

*Footnote: Visit the Investor Relations section of officemax.com to view OfficeMax’s second-quarter results.